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ELRCDismissedCause No. 232 of 2016 (Consolidated with Causes No. 219, 338, 339 & 340 of 2016)· [2019] KEELRC 1236 (KLR)

Cleopatra Kama Mugyenyi v Aidspan [2019] KEELRC 1236 (KLR)

Employment and Labour Relations Court of Kenya
4 July 2019
HWHellen S. Wasilwa
1,727 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~7 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court confirmed that employers don't have to renew fixed term contracts unless they gave workers a real reason to expect renewal.

What this practically means

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Executive summary

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Five Claimants sued Aidspan in the Employment and Labour Relations Court at Nairobi, in consolidated causes, claiming that the Respondent had failed to renew their fixed term contracts of employment despite a legitimate expectation of renewal. They sought pay in lieu of notice, gratuity and twelve months' salary as damages. The Claimants argued that their prior renewals, and alleged promises of renewal, created a legitimate expectation, and that the non-renewal was discriminatory, unlawful and in breach of contract, invoking Sections 41(1), 43 and 45 of the Employment Act on fair termination. The Respondent maintained that the Claimants were on fixed term contracts without renewal clauses, that renewal required mutual agreement and Board approval under the Administration Manual, that no promises of renewal were made, and that notices of end of contract were duly issued. The court, per Wasilwa J, held that the Claimants were on fixed term contracts that came to term, and relying on Fatuma Abdi v Kenya School of Monetary Studies and Rajab Barasa v Kenya Meat Commission, that fixed term contracts cannot be renewed automatically; there must be an indication by act or omission by the employer that renewal was forthcoming. Finding no such indication, the court held the Respondent was not to blame for the non-renewal. The claim for gratuity failed because Section 35(6) of the Employment Act bars gratuity for NSSF members, which the Claimants were. The only relief granted was issuance of Certificates of Service, with each party bearing its own costs.

Key legal issues

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01

Legitimate expectation of renewal of fixed term contracts

Holding

The Claimants had no legitimate expectation of renewal; their contracts ended upon expiry of time and the Respondent was not to blame for non-renewal.

Reasoning

The court found the Claimants were on fixed term contracts which came to term. Relying on Fatuma Abdi and Rajab Barasa, it held that fixed term contracts cannot be renewed automatically; there must be an indication by act or omission by the employer that renewal was forthcoming. No such indication was shown, so the claims founded on legitimate expectation failed.

p. 3
02

Entitlement to gratuity

Holding

Gratuity not payable as the Claimants were NSSF members.

Reasoning

Section 35(6) of the Employment Act 2007 excludes payment of gratuity to employees who are members of the NSSF. The court found the Claimants were such members and therefore disallowed the prayer for gratuity.

p. 3
03

Certificate of Service

Holding

Granted as the only prayer allowed.

Reasoning

Of all the reliefs sought, only the prayer for issuance of a Certificate of Service was granted, the court finding the contracts terminated by effluxion of time rather than unfair termination.

p. 3

Legal principles established

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  • A fixed term contract cannot be renewed automatically; legitimate expectation of renewal arises only where the employer has by act or omission indicated that renewal was forthcoming.
  • Gratuity is not payable to employees who are members of the NSSF by virtue of Section 35(6) of the Employment Act.

Court orders

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  1. 1.Claim for renewal-based damages, pay in lieu of notice and gratuity dismissed
  2. 2.Claimants granted issuance of a Certificate of Service
  3. 3.Each party to bear its own costs

Authorities

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Legislation

  • Employment ActSection 41(1)
  • Employment ActSection 43
  • Employment ActSection 45
  • Employment Act 2007Section 35(6)

Cases cited (5)

  • Eunice Mwikali Munyao Vs Elys Chemical Industries Limited
    (2017) eKLR
  • Dierks vs University of South Africa
    (1991) BLLR (LC)
  • Fatuma Abdi Vs Kenya School of Monetary Studies
    (2017) eKLR
  • Ruth Gathoni Ngotho Kariuki Vs the Presbyterian Church of East Africa & Another
    null
  • Rajab Barasa & 4 Others Vs Kenya Meat Commission
    (2016) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and Labour Relations Act (not expressly cited in judgment)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Cleopatra Kama Mugyenyi v Aidspan [2019] KEELRC 1236 (KLR)", Case Analysis (2019). Cause No. 232 of 2016 (Consolidated with Causes No. 219, 338, 339 & 340 of 2016). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/1236/eng@2019-07-04

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.